Mixing the Carrots with the Sticks: Third Party Punishment and Reward

Nikos Nikiforakis () and Helen Mitchell
Additional contact information
Helen Mitchell: Department of Foreign Affairs and Trade, Australian Government

No 1338, Working Papers from Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon

Abstract: While the opportunity to punish selfish and reward generous behavior coexist in many instances in daily life, in most laboratory studies, the demand for punishment and reward are studied separately from one another. This paper presents the results from an experiment measuring the demand for reward and punishment by ‘unaffected’ third parties, separately and jointly. We find that the demand for costly punishment is substantially lower when individuals are also given the ability to reward. Similarly, the demand for costly reward is lower when individuals can also punish. The evidence indicates the reason for this is that costly punishment and reward are not only used to alter the material payoff of others as assumed by recent economic models, but also as a signal of disapproval and approval of others’ actions, respectively. When the opportunity exists, subjects often choose to withhold reward as a form of costless punishment, and to withhold punishment as a form of costless reward. We conclude that restricting the available options to punishing (rewarding) only, may lead to an increase in the demand for costly punishment (reward).

Keywords: punishment; reward; social norms; norm enforcement; third party (search for similar items in EconPapers)
JEL-codes: C91 D03 D63 H41 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
ftp://ftp.gate.cnrs.fr/RePEc/2013/1338.pdf (application/pdf)

Related works:
Journal Article: Mixing the carrots with the sticks: third party punishment and reward (2014)
Working Paper: Mixing the carrots with the sticks: third party punishment and reward (2014)
Working Paper: Mixing the Carrots with the Sticks: Third Party Punishment and Reward (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gat:wpaper:1338

Access Statistics for this paper

More papers in Working Papers from Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon Contact information at EDIRC.
Bibliographic data for series maintained by Nelly Wirth ( this e-mail address is bad, please contact ).